Friday 9 November 2012 12.11 EST
First published on Friday 9 November 2012 12.11 EST

After nine years and more than £1bn of investment, Chelsea are in the black for the first time in the free-spending Roman Abramovich era, thanks to their Champions League victory, a rare profit on transfers and improved commercial deals.

The chairman, Bruce Buck, claimed on Friday that the modest profit of £1.4m for the last financial year, compared to a £67.7m loss the year before, showed they were on course to meet Uefa's new financial fair play (FFP) obligations. Those rules, designed to curb rampant wage inflation and cases of what Uefa's president, Michel Platini, calls "financial doping", require clubs to break even within an "acceptable deviation" of €45m over three years.

The selective figures for Chelsea, which cannot be analysed in full until they are lodged with Companies House next week, show the club banked a record turnover of £255.7m, compared to £222.3m the previous year, and overtook Arsenal to become Europe's fifth largest club in terms of revenue.

That figure was boosted not only by Champions League prize money and ticket revenue but Uefa's improved TV rights deal, new commercial deals and a profit on transfer dealings of £28.8m.

While the acquisitions of Gary Cahill and Juan Mata were included in this set of accounts, the summer splurge on Oscar, Eden Hazard and Victor Moses was not. For accounting purposes, incoming transfers are amortised over the length of their contract while sales can be banked immediately.

While Chelsea do not reveal individual transfer fees, the profit has been put down to the sales of Yuri Zhirkov to Anzhi Makhachkala, Alex to Paris Saint-Germain and Slobodan Rajkovic to Hamburg. While the fees and wages paid for players such as Hazard and Oscar will increase outgoings in coming years, the club has also moved on high earners, including Didier Drogba, Nicolas Anelka and José Bosingwa.

The figures indicate Chelsea will have to walk a financial tightrope in order to comply with FFP, but the club believe they can marry continuing investment in the squad with breaking even. Many clubs are hoping the Premier League will introduce its own rules to help curb wage inflation.

Given the constraints of Chelsea's relatively small stadium compared to their Premier League rivals', they will look to make up the gap through improved commercial deals.

They have signed new contracts with Gazprom, Sauber, Delta and Audi since the last financial year. The next round of Premier League TV deals, including a record £3bn domestic live contract with Sky and BT, will also help boost future revenues.

Arsenal are likely to again leapfrog Chelsea in revenue terms when they complete new shirt and stadium sponsorship deals in 2014 to replace long-term contracts agreed with Nike and Emirates to underwrite the move to their new stadium.

"Our club philosophy is built on success. We had that success on the field this year, as we were the first London team to win the Uefa Champions League, and we enjoyed it off the field as well and this helps us inject financial investment into the team," said the chief executive, Ron Gourlay. "The big challenge is always to have a successful team on the field that wins trophies and to make a profit at the same time."

Chelsea also revealed that Abramovich had converted a further £166.6m of loans to equity, leaving its balance sheet debt- free. That does not have a bearing on FFP calculations but provides a degree of reassurance that he will not leave the club burdened with debt.

The club also bought out BSkyB's stake in their joint venture digital media operation. The ability to exploit secondary media assets on an international basis is expected to become increasingly important as technology improves and global fanbases grow. Roberto Di Matteo said the club was "doing everything in our power" to comply with Uefa's rules.

"For the first time we have been able to achieve a profit, also thanks to the success on the field but off the field with new sponsor deals and the transfer market, so going forward I think that puts Chelsea Football Club in a strong position to remain competitive domestically and internationally," the manager said.